CIOs Can Help Government Restructure

Guest Contributor

Governments at all levels–national, state and local–have lagged the private sector when it comes to adjusting to structural economic changes such as globalization and the rise of digital technology. But they are now stepping up to these challenges, and looking to their CIOs to help leverage IT for improved efficiencies in all aspects of their operations, as well as to help come up with innovative strategies to help government better adjust to the realities of 21st century economies.

These governments must address two major structural issues: they must become more efficient; and they must seriously tackle the rising costs of public services by restructuring entitlement programs that are no longer affordable. Aligning government with 21st century economic realities will require innovations at least as disruptive and profound as those embraced by the private sector.

Productivity and cost reductions have been key business objectives over the past 20 years. Could some of the practices that have worked well in the private sector be applied to government?

Their recommendations are based on leveraging advances in information technologies and organizational practices that are already being successfully applied by CIOs in the private sector. These include the consolidation of IT infrastructures across departments and agencies; moving to shared services, including cloud computing and inter-agency staff services, e.g., finance, legal, HR; and the use of advanced analytics to reduce improper payments.

Given the inherent differences between business and government, it is reasonable to question the extent to which good ideas and best practices from the private sector can be applied to the public sector. After all, there is a huge difference between the key objectives of business–e.g., managing revenues and profits, and acquiring and retaining customers–and those of democratic governments, where the quality of life of its citizens–so well embodied in the phrase life, liberty and the pursuit of happiness–is among its top objectives.

Perhaps nowhere are these differences more apparent than in job creation, one of the toughest challenges facing nations around the world given the major structural changes their economies are going through. While companies have responsibilities to the communities in which they operate, for them job creation is not a primary responsibility, but a consequence of operating a successful, growing business. For governments, fostering an environment that enables the creation of well-paying jobs is one of their primary responsibilities and key to helping their citizens achieve a good standard of living and quality of life.

But there are also many similarities between government and business. Large government institutions and large companies are both complex organizations employing many people and providing a wide variety of services to their citizens and clients respectively. Both operate in increasingly fast-changing, complex, unpredictable environments. Both have access to innovative technologies and management practices that can be of significant help in dealing with their complex operations. And, regardless of whether dealing with citizens or clients, both can significantly benefit from running more efficient, collaborative organizations.

The challenges facing government are enormous. There are no one-size-fits-all solutions for government innovation and reform, any more than there have been for business transformation. Different nations will make different choices. And in large, diverse societies like the U.S., it is quite likely that different states, regions and cities will come up with different approaches that best fit their respective constituencies.

Clearly, government and business have different objectives and operate by different rules. Most companies had to go through considerable turmoil and pain to adjust to the powerful forces restructuring our global economies. Those that didn’t, did not survive or are shadows of their former selves. But, there is a huge difference between failed companies and failed communities, cities or countries. Clients can easily find other companies to do business with in place of the ones no longer around. This is not the case with citizens.

As governments are now addressing some of these same powerful forces, they are going through even more turmoil and pain. Having led many of the efforts that successfully transformed their institutions over the last two decades, CIOs have much to contribute to help our governments and societies adjust to the new realities of the 21st century.

Irving Wladawsky-Berger is a former vice-president of technical strategy and innovation atIBM. He is a strategic advisor toCitigroupand is a regular contributor to CIO Journal.

Deloitte Touche Tohmatsu Limited's fourth annual Millennial Survey reveals the business activities and outcomes members of Generation Y would prioritize if they held leadership positions. In highlighting millennials' priorities, the survey results draw attention to this generation's values and the themes large enterprises should speak to if they wish to attract and retain members of this rising workforce.